Nigeria’s inflation rate slows 17.38% in July — fourth consecutive decline in 2021

The consumer price index (CPI), which measures the rate of change in prices of goods and services, moderated for the fourth consecutive time to 17.38 percent in July from 17.75 in June.

This implies that prices continued to rise in July 2021 — but at a slightly slower pace than it did in previous month.

This is according to the ‘Consumer Price Index Report for July’, released by the National Bureau of Statistics (NBS), on Tuesday.

The slow down in inflation was due to the broad-based slowdown across the food baskets, however, core inflation increased during the period.

On month-on-month basis, the headline index increased by 0.93 percent in July 2021. This was 0.13 percentage points lower than the rate recorded in June 2021 (1.06) percent.

The urban inflation rate increased by 18.01 percent (year-on-year) in July 2021 from 18.35 percent recorded in June 2021, while the rural inflation rate increased by 16.75 percent in July 2021 from 17.16 percent in June 2021.

Core inflation, which excludes the prices of volatile agricultural produce stood at 13.72 percent in July 2021, up by 0.63 percent when compared with 13.09 percent recorded in June 2021.

Pressures were most significant in the prices of garments, shoes and other footwear, clothing materials, other articles of clothing and clothing accessories, vehicle spare parts, major household appliances whether electric or not, pharmaceutical products, cleaning, repair and hire of clothing, furniture and furnishing, medical services and hospital services.

On the other hand, the composite food index moderated for the fourth consecutive month to 21.03 percent in July 2021 compared to 21.83 in previous month.

This implies that food prices continued to rise in July 2021 — but at a slower speed than it did in June 2021.

The food price growth has kept inflation above the single-digit target of the apex bank since 2016.

The rise in the food index was caused by increases in prices of milk, cheese and eggs, coffee, tea and cocoa, vegetables, bread and cereals, soft drinks, and meat.

“In July 2021, food inflation on a year on year basis was highest in Kogi (28.51%), Enugu (24.57%), and Lagos (24.04%), while Akwa Ibom (17.85%), Bauchi (17.74%) and Abuja (16.67%) recorded the slowest rise in year on year inflation,” the report said.

“On month on month basis however, July 2021 food inflation was highest in Kebbi (2.98%), Yobe (2.81) and Delta (1.98%), while Sokoto, Akwa Ibom and Imo recorded price deflation or negative inflation (general decrease in the general price level of food or a negative food inflation rate).”